Ö÷²¥´óÐã

'More important, to some, than the gender imbalance'

Why shoud the gender imbalance matter to anyone ? All that matters is that the committee has been elected on merit, the way you were (one assumes).

'But neither that or the gender imbalance are likely to be resolved any time soon. The four external members of the MPC are all fairly recent appointees'

Isn't there a rather more obvious reason why the imbalance won't be resolved anytime soon ? There's a clue in final sentence of the preceding paragraph. Are you suggesting we should start appointing people based on their gender rather than their ability ?

"But the sensitivity of households' interest payments is not top of the list."

No. To someone from Goldman Sachs who has no idea what it's like to have a shrinking disposable income, or to live in fuel poverty, or to be in danger of losing one's home, I don't suppose it would be.

Why can't the bank do the decent thing and employ someone who isn't a banker - because these vastly overpaid and self-congratulatory "experts" are so shamefully and scandalously bad at predicting or managing the future that if they practiced a reality-based discipline such as physics or engineering they'd be fired for gross incompetence.

All this user's posts have been removed.Why?

"Mr Broadbent is a widely respected economist"

It can't be right to use the words 'respected' and 'economist' in the same sentence!

Put a 36 year old housewife with 3 kids and a husband earning £40k on the committee (or house husband - who cares which ??) Or would the presence of someone in the real world be a little to much for these creatures ? Boards of Trustees have to have lay members, so why not the MPC ?

Bit too close to home for people on gigantic incomes and no mortgage perhaps ?!

And drop the gender issue for gods sake - its VERY TEDIOUS.

What about the wealth balance? Shouldn’t we have a few poor folk in the group? After all they suffer the consequences.

And the intelligence balance? Perhaps, a few working, middle class engineers, mathematicians and scientists would also add something.

How can I write such rubbish? I should know that ordinary mortals cannot understand the towering and charitable intelllects of bankers and economists.

The problem is, surely, that to be a "widely respected economist" you would have to have bought into the prevailing orthodoxy that brought us to this pretty pass (everyone else is still a heretic). This belief system will, doubtless include:

- the idea that a low pound will help the UK to export its way to growth, when all the evidence is that the low pound is fueling imported price inflation. (Not surpising in a consumer economy that does produce anything much)

- the idea that price inflation will enable us to pay off the deficit, when (as has been said before) the fact that food prices are going up will not help someone pay their mortgage unless, and until, wage inflation kicks in.

- the idea that there is surplus productive capacity in the system that will keep inflation down, when we are seeing a collapse in demand in a consumer based, service economy (so who is going to invest in new production capacity?)

- perhaps worst of all, the idea that there is no distinction between wealth (accumulated past income) and debt (anticipated future income) and that all we need to do is stimulate borrowing.

All these misplaced theories are driving current thinking and the idea that pre-credit crunch condition were a normality to which things should return.

Some hope....

#6

I agree entirely. I find it patronising in the extreme that we are constantly led to believe that these City types are in any way at all better qualified to provide an opinion on the economy than you are or indeed I am.

The mood has changed in the last month.

The expectation that getting on, working, honesty, commonsense, self respect, self reliance, all go together, has died.

The population percieves our social-economy as corrupt. It's not difficult to see why. From the £65kpa lifestyle of a socially housed benefit dependent single mum of 2, to the £ million bonuses for bankers who bankrupt their own bank and an expenses disgraced Ö÷²¥´óÐã Secretary constantly appearing on the Ö÷²¥´óÐã.

Whatever the BoE does is immaterial. Strikes for big wage claims across the board are coming. Young people need a home to have a family and a wage to support that family. They have no choice but to strike.

Govt does have a choice. Scrap planning laws and divert all these young people's energy in to cheap new owner occupied homes and cheap to set up business'. A few tiny zones won't cut it. The whole country needs to be an economic zone.

"Only today, he and a colleague published a paper suggesting that households were less vulnerable to interest rate rises than generally thought"

I understand that his salary will be 131,771 pounds ($212,944) plus healthcare benefits, and the position will be on a part-time basis, averaging three days a week. Was this published paper a reflection on his new appointment?

so another Goldmanite in a central bank , the same Goldman Sachs that were partly responsible for the credit crunch through the creation of economic mass destruction, the same that paid fines for their practises rather than anyone end up in jail, and he is respected and you are lauding him for saying "high commodity prices bad for joe taxpayer, low pound inflate away the debt, erm great how much are we paying for those nuggets

Anyone know what the odd 1,771 quid is for? I like to think of it as Double Diamond money. Does anyone remember the good old days when Double Diamond was what your right hand was for and when the characters B and W were 20 letters apart?

Strong exports create employment,income and domestic demand.Fine

But if we export in a devalued currency and import in a deflated pound,the terms of trade move against us.In other words we give more for less,weakening domestic demand.

With a looming oil spike leaching purchasing power from us to them,I don`t buy Mr.Broadbent`s argument that increasing exports compensates for spending cuts.This would be the case if the devaluation of the pound and rising import prices were merginal.They`re not,the pound is devalued by 25%,oil has almost doubled in price over a year and so on.

The combined effect of spending cuts and weak terms of trade is to reduce consumption and investment.In this context I can`t so why stand alone exports are reflationary?In the 1930s,the terms of trade moved strongly in our favour, increasing real incomes and compensating for the effects of the slump.Now the terms of trade are strongly against us.

Perhaps Mr.Broadbent`s appoinment is more to do with cheer leading than economics.

Whilst it may not be a first, there have been 12 responses so far and all reflect general agreement at their displeasure at this appointment.

I know that the gender balance of bloggers is highly skewed but the majority are showing restraint when it comes to Stephanie's cooment upon the gender balance of the MPC. I truly don't believe that this is a gender issue. It should be a competence issue. In this appointment, it would appear that the competence of the appontee is being severly challenged.

Just what we need another banker controlling our lives...And from Goldman Sachs too! Sometimes you really couldn't make it up.

Don't we also have enough people from Harvard Business School in authority as when one looks at their record is is not very good.

Is this the same Goldman Sachs who fudged the figures so Greece could join the Euro? If so heaven help us. The only good news is that he seems to be in favour of higher interest rates. Perhaps inflation will moderate and we will be able to achieve a modest real return on our money, although with pensioner inflation in double figures this is a very remote possibility.

End this MPC fiasco now!

Only the Chancellor should be setting interest rates ... the MPC was created as an abdication of responsibility by 'you know who' and it fulfils its role very well and repeatedly fails to achieve anything with its ridiculous inflation control bungling.

Do these MPC clowns get paid? If so 'Why'? and What for?

" When Mr Broadbent joins, all of the four external members of the MPC will have spent most of their career as macro-economists"

God help us !

Yet another person who gets to control us in their interest.
For themselves. They control us for themselves.
And we let them.
"widely respected economist" AKA gambler.

But he is now being allowed, nay, required to load the dice.
I wonder in whose favour he gets to load them?

"widely respected economist" a contradiction in terms.

Economists only exist to make weather men look good.

Re #15

"I truly don't believe that this is a gender issue."


Sould have read "I truly don't believe that this is NOT a gender issue."

Sorry!

Well....let's hope Ben Broadbent has a good sense of humour. If I were joining the MPC in May, I would be looking to assemble a list of good belly laughs for the start and the end of each meeting. Because, in between those times, there will be very little to smile about.

1. At 1:47pm on 07 Mar 2011, jobsagoodin wrote:
'More important, to some, than the gender imbalance'

Why should the gender imbalance matter to anyone ? All that matters is that the committee has been elected on merit, the way you were (one assumes).

-----------------------------

Totally agree!

The only issue relevant here is the competence of the members of the committee and the experience / knowledge that they bring to it.

This committee ‘has’ to make the right call (we’re depending on them), so the point of interest here is what their views are. Why Stephanie even mentions gender imbalance is rather baffling – it’s an irrelevant sideshow!

That would be Harriet Harman’s angle on the story; it shouldn’t be the angle of the Economics Editor of the Ö÷²¥´óÐã!

Interesting comments some are making about members of the MPC being appointed on the basis of merit not on gender. In the world of economists merit is rather a subjective concept. If merit was the criterion we would be looking for economists who have made the correct predictions over a long period of time and who have advocated policices which have been proved to deliver what was required. I wonder how many of the MPC would get an 'outstanding' grade set against this criterion.

There are other points to consider. The most important one is that a diversity of perspectives would seem to be essential for any successful organisation. Don't confuse this with a diversity of objectives. The other one which is in favour of female representation is recent research which shows that having female representation on the board of a company seems to improve its share price.

Why is the MPC completely dominated by bankers and economists? Why don't they get the likes of Dyson and Branson on there? If we are ever to engineer our economy towards making stuff again and running successful service industries we need people on there that can walk the walk.

You all forget, economics is my pocket.

The census results have some shocks in store for next year. I've commented on this before but I'll say it again. A benefit dependent single mum in social housing has the lifestyle of 2 experienced teacher salaries, or 2 experienced nurse salaries. Graduates are choosing to become benefit dependent single mums because it's the only way to have children in your 20s or early 30s.

Once the working 20, 30 and 40 somethings have this confirmed they'll strike hard for big wage rises on the basis they should be able to afford a family too.

Who cares? It makes no difference whether interest rates go up or stay the same. Ever since the bank bail out, we have been consigned to being a country in decline for the next 5 to 10 years. The only way the economy is going to be setup is in favour of the banks and no one else. There is still the derivatives problem to sort out.

I haven't read the comments above but I suspect that the words, Broad, Bent, Goldman and Sachs have been reassembled with ruthless creativity.

Think of things like this:
1) The banks and speculators drive up food prices
2) Gold prices drop and political unrest flairs up
3) The EU says it will raise rates and kill any profits thus ensued
4) Moodys drops the EU credit rating

Last year this would have prompted unlimited media assaults on the Euro, a bailout fund, and wholesale dread that the Eurozone was about to enter an apocalyptic descent into unending turmoil.

Today however no-one could care less because everyone now knows that Moodys is a political entity working for American banks.

sizzler

But you also forget that automation and capital shifts to countries that have procreated most have made most people unemployed.

If we collaborate on a manufacturing platform that is highly efficient, flexible, and requires little more than robots and/or cheap labour, then who are the consumers?

While we have a "service" economy, where millions of western office workers are given meaningless tasks in highly inefficient operational models, where people don't actually do or make anything, then we must either accept that working in an office doing services or financial services is nothing more than a smoke and mirrors alternative to state support - it's just the finance industry giving its subscribers an illusory meaning to life, a tad more than being on the dole, but similarly unproductive.

Sizzler

" The census results have some shocks in store for next year. I've commented on this before but I'll say it again. A benefit dependent single mum in social housing has the lifestyle of 2 experienced teacher salaries, or 2 experienced nurse salaries. Graduates are choosing to become benefit dependent single mums because it's the only way to have children in your 20s or early 30s."

Can you point me to evidence that graduate women are choosing to become single mothers in social housing? A lifetime of single motherhood chained to a sink estate doesn`t appear to be an attractive choice for someone who has worked their way through university for three years and incurred large debts.

A readable if gossipy blog Ms Flanders.

After The Turner and King Show...
both without any doubt, whatsoever, presenting
very helpful performances to PROMOTE
Healing of UK plc, to render more likely

a proactive harmony between The Banks and Mother Britain
....another MPC player comes into the wings
waiting to come onto the stage
To tickle the bile ducts of the populace

Just look what the Ö÷²¥´óÐã
And the BoE and the FSA
are doing to the Integration of the Nation
Ms F
And weep.

Wee-scamp @ #6

Precisely! On what premise is it decided that these people can govern better than an online referendum? What about an online competitive referendum with reward bias to those who consistently judge well?

It is interesting that in this time of Arabic reform we hear the word "democracy" being used time and time again, often in the context of a debate on who should be the next leader or authority, when it is being misused as a synonym for the noun phrase "representative democracy".

What about "direct democracy". As in Switzerland and elsewhere. What about online referendum? What about using modern mass communication technology and giving the cracy to the demos for a change?

Bryhers, Sizzler

Sizzler's comments are clearly nonsense, but still, on reflection, if graduates were choosing to have children in such conditions, then we should support them. It would be a good method of preventing the mean IQ from dropping and keeping the TFR up.

I think you're all being too hard on Stephanie and her comment about gender balance at the MPC.

Surely it shouldn't be that difficult to find an equally incompetent woman to turn a blind eye to rampant inflation and keep interest rates at 0.5%?

@29 Oblivion

Replying to my own post! It's an explanation for those of you who wonder why their life is so dominated by office politics: the role of office politics grows more important as technology automates out the useful people. At the end of the day - you just have to learn to play a psychosocial game of getting the most stuff you want, be it money, goods, or time, because there are no longer any utilitarian criteria upon which to build a meritocratic system.

#31 Amused2Death

What's that? Concrete poetry?? But yes, the gist is definitely gettable and agreeable.

Apart from the possible exception of Andrew Sentance, nobody else on the committee is in favour of punishing anyone with a rate rise. For as long as GDP remains either stagnant or (worse) continues our actual decline, a rate rise would simply reduce GDP still further and make our tax receipts lower and the deficit higher.
Fortunately, many City dealers know that, and will be content to await the second estimate of first quarter growth (due towards end of May) before expecting any BoE rate change.
In any case the critical interest rate is in the fixed interest Bond Markets and they're not signalling a UK rate increase either.

I don’t think that people are recruited to the MPC or perhaps to the Ö÷²¥´óÐã on merit. They may be recruited on apparent merit and that is a big difference. Because of our history, we ‘merit’ men more than we ‘merit’ women, so men are given the jobs, we reinforce the stereotypes and the vicious circle continues.

36. At 8:37pm on 07 Mar 2011, Oblivion wrote:
#31 Amused2Death

What's that? Concrete poetry?? But yes, the gist is definitely gettable and agreeable.[End]

Well concrete before it sets is fluid....it continues to harden for twenty, thirty , fifty years after being mixed and poured.

Thanks (I think).

In a free society interest rates would be set by the market. Allowing individuals, who have their own agendas, to set the rate and manipulate the whole economy, is tantamount to letting the fox look after the chicken coop.

SF wrote: Mr Broadbent is a widely respected economist..
----------------------------------------------

Surely that is an oxymoron, outside Harvard and the LSE?

"Can you point me to evidence that graduate women are choosing to become single mothers in social housing? A lifetime of single motherhood chained to a sink estate doesn`t appear to be an attractive choice for someone who has worked their way through university for three years and incurred large debts."

I don't have that evidence, but it's pretty clear they're choosing not to have children. When they do, they tend to pay a packet in IVF, and end up looking like a bulldog chewing a wasp. Not happy.

Benefit payouts to single mums are spectacular. I await the day the government publishes proper figures that include housing benefit (or support for mortgage interest) + child benefit + child tax credit + personal tax credit + income support benefit + council tax relief. Well above net average income.

This guy from Goldman Sachs is just another addition to the politburo ... does anyone care?

This comment was removed because the moderators found it broke the house rules. Explain.

All this story does is remind us that an unelected group continue to make the decisions for the UK economy. A primitive idea of what society's institutions should be.

Anyway the BoE/MPC will continue with their stagflation policy:

low interest => inflation
new bank regs => stagnation.

But we cannot vote for or against them - the real AV we need is for membership of the MPC.

"Mr Broadbent is a widely respected economist"

A fool respected by other fools - great appointment!

I'd be interested to know how much the moral and ethical outlook of prospective members is considered, alongside their academic and career achievements?

Here we are, the economy balancing on a tightrope and what? We're concerned with gender balance!!!

Look, it doesn't matter a toss who is on this committee as long as King does his job properly and gets inflation on target. You won't get a recovery with high inflation and wages flattened out. "Consumers" (bless the title) turn away from all but necessities when things get tighter.

#40 Libert_arian argues that interest rates should be set by the market and not individuals.
#44 Mike3 adds that the BoE's MPC is continuing 'their stagflation policy'.

Both are misunderstandings.
Interest rates are largely set by the money markets in London and New York. The main interest rates are set in the Bond Markets where prices fluctuate according to supply and demand for Bonds. As for the less important variable rates, the BoE's rate has remained close to ECB's and Federal Reserves rates. Each of those currently reflect the fact that households and businesses are paying down debts and saving as fast as they can: the falls in money supply demonstrate that demand is down and supply of credit is not being taken up - even at bargain rates!
Moreover, the real interest rate to watch for are national 'inflation & risk adjusted' rates, which are remarkably similar.
Because interest rates are set mostly by market conditions, it simply isn't true (as it was to some extent in the UK prior to Brown's imposed change in 1997) that the BoE or Fed is following any stagflation policy.
What's really happening is that market participants are more averse to borrowing and risk than usual. Which sentiment and action is forcing down interest rates in Europe and N. America.

Paul Krugman blog, March 7, 2011:
"Does IMF Stand for Impressive Macroeconomic Flexibility?
So the IMF is holding a meeting on rethinking macroeconomic policy (I was invited but couldn’t make the timing work.) And the Fund’s chief economist has already made it clear that he’s open to some serious revision of the prevailing paradigm.
Since when is the IMF — whose initials, the joke used to go, stood for 'it’s mostly fiscal' — so open-minded?
Some of us were actually talking about that after Henry Farrell’s talk on Keynesianism in the crisis here last week.
At one level, it’s easy to explain: yes, this stuff is coming from the IMF, but more specifically it’s coming from Olivier Blanchard — salt-water macroeconomist extraordinaire, definitely a guy willing to entertain heterodox ideas and take them seriously. Knowing Olivier, who was my colleague for many years, I’m not at all surprised to hear him saying what he’s saying.
But then the question becomes, why is the IMF willing to let him speak up? Other international organizations, like the OECD, have been willing to throw all logic aside in order to be properly austerian; why not the Fund?
One answer is that Blanchard is who he is — a big gun in the field, someone the IMF needs more than he needs the IMF, who has the kind of independence that lets him speak his mind.
Another answer is that Strauss-Kahn runs the IMF, and — aside from being Blanchard’s compatriot — he’s a political force in his own right, to an extent unusual for the Fund, and one with moderately interventionist instincts.
Whatever the explanation, I like the results: the IMF has been doing terrific research work, and has been a breath of fresh air in policy debates."

And so it begins...

44. At 00:34am on 08 Mar 2011, Mike3 wrote:
All this story does is remind us that an unelected group continue to make the decisions for the UK economy. A primitive idea of what society's institutions should be.



Absolutely. The financial terrorists have ridden roughshod over democracy: the banks, the MPC, the photocopying room (where QE takes place), and the big corporations. Simply look at the many toothless watchdogs the government has set up as the utilities suck in our money and blame a computer when they've overdone it. You're usually penalised financially if you decline entry to the direct debit vampyre because they love to have control over your bank accounts!

So democracy has gone. All you've left to vote for is a bunch of wind-bags who couldn't run a bath let alone a country; and who can do nothing about these financial fascists. Nothing soever.

@5. John_from_Hendon:

Good for a belly-laugh, I grant you.

But there have been economists who have commanded respect, by reason of their intellects not necessarily their opinions (I won't bother to put forward my complete list, but it starts with Benjamin Franklin - I know, not an economist, but the discipline used to be known as "political economy" and is IMO best viewed as a subset of political philosophy, embracing among many other luminaries, Karl Marx, Adam Smith, Ludwig von Mises, Aristotle...).

The point, surely, is that membership of the MPC ought not to be so confined (as it seems to be) to economists but widened to include more people respected as *thinkers*, albeit with a practical bent and a proven track record. A distinguished scientist or two wouldn't go amiss IMO.

10. At 4:01pm on 07 Mar 2011, sizzler wrote:
The mood has changed in the last month.

The expectation that getting on, working, honesty, commonsense, self respect, self reliance, all go together, has died.

The population percieves our social-economy as corrupt. It's not difficult to see why. From the £65kpa lifestyle of a socially housed benefit dependent single mum of 2, to the £ million bonuses for bankers who bankrupt their own bank and an expenses disgraced Ö÷²¥´óÐã Secretary constantly appearing on the Ö÷²¥´óÐã.
-----------------------------------------------------------------------
I thought unemployment benefit was approx £2500 pa, so how does having two children add £62,500 to that? I find that income a tad hard to believe for an unemployed Mum. Perhaps she has a part-time job producing £50K pa - also a banker perhaps?

Or were you exaggerating to underpin a weak, banker bashing point ...

"From Goldman Sachs to the MPC" is the title of Stephanie Flanders' blog.

OH MY GOD!

So the old revolving door between Whitehall and the City turns again. This is the only revolution we are likely to see these days.

I am left wondering if the Old Lady of Threadneedle Street is one of those three who are described in the traditional song as being unfortunately detained in a place of convenience and ease. The song is wonderfully ironic.

@51. At 11:49am on 08 Mar 2011, torpare wrote:

"The point, surely, is that membership of the MPC ought not to be so confined (as it seems to be) to economists but widened to include more people respected as *thinkers*, albeit with a practical bent and a proven track record. A distinguished scientist or two wouldn't go amiss IMO."

-----------------------------

Yes. Or even a passable stand up comic would do, I dunno, Jeremy Hardy, Simon Hoggart, Sandi Toksvig, Richard Ingrams. Someone from "Sorry I haven't a clue" might be a more appropriate choice. How 'bout Jack Dee.

Very interesting. Does this give companies like Goldman Sach's an unfair competitive advantage? They will surely know all the characters on the committee, their personal views, how they could effect policy, and in the process also be getting access indirectly or directly to confidential data the BoE has? After all you said yourself on the news 'people in the city are paid alot of money to predict changes in interest rates'. That's life though an aspect of competition and the value and cause for having 'access' to people.

The inflation graph previously posted on one of your blogs from the ONS was very useful you can work out your own upper and lower limts and trends for RPI and CPI eg RPI 2011 most likely 4.5% and CPI 2.5% on average. You can even do a linear regression on it and see a steady increase over the last 10 years. Could you provide others with house prices and oil prices on it. I think all that data provided together is a good guide to potential inflation (unless there is a double dip / exceptional circumstances). I think it is possible to draw out some reasonable trends without being an expert and/or having all the background data.

#48 Leftie,

"Each of those currently reflect the fact that households and businesses are paying down debts and saving as fast as they can: the falls in money supply demonstrate that demand is down and supply of credit is not being taken up - even at bargain rates!"


If you look at the following stats then you seriously have to challenge tha above contentions. BTW, why are we asking the banks to lend more to business when all of a sudden we are being told that companies are cash rich and sitting upon those reserves? Methinks there is a lot of nonesense and propoganda being talked.

# Total UK personal debt at the end of January 2011 stood at £1,452bn. The twelve-month growth rate remained unchanged at 0.7%. Individuals currently owe more than the entire country produced in the year between Q4 2009 and Q3 2010.
# Total lending in January 2011 rose by £1.5bn; secured lending increased by £1.8bn in the month; consumer credit lending decreased by £0.3bn (total lending in Jan 2008 grew by £8.4bn).
# Total secured lending on dwellings at the end of January 2011 stood at £1,240bn. The twelve-month growth rate remained unchanged at 0.7%.
# Total consumer credit lending to individuals at the end of January 2011 was £212bn. The annual growth rate of consumer credit fell 0.3 percentage points to 0.8%.
# UK banks and building societies wrote off £9.7bn of loans to individuals in the 4 quarters to end Q4 2010. In Q4 2010 they wrote off £2.27bn (£1.18m of that was credit card debt). This amounts to a write-off of £24.88m a day.
# Average household debt in the UK is ~ £8,416 (excluding mortgages). This figure increases to £16,185 if the average is based on the number of households who actually have some form of unsecured loan.
# Average household debt in the UK is ~ £57,635 (including mortgages). If you add to this the March 2010 budget report figure for public sector net debt (PSND) expected in 2015-16 (excluding financial interventions) then this figure rises to £109,857 per household.

(calculations from Credit Action using BoE stats)

As Goldman Sachs derives almost half its earnings from work for the US Government, is there not a conflict of interest in Mr Broadbent's appointment?

#10 sizzler

"the £65kpa lifestyle of a socially housed benefit dependent single mum of 2"

Having brought up my son on my own since he was 11 I'm intrigued to learn of this. Please furnish your calculations with reference to current benefit rates. Either that or save your comments for the Sun website.

Re graduate single parents.

Like a good Engineer I decidedly to actually do some basic calculations, using a very conservative example and online benefits info and the Directgov benefits calculator.

A single parent with one child under 4 and a second child under 1 year old, living in rural south Dorset in private rented accommodation would currently be given £20,392 p/a in cash, around £483 in healthy start vouchers and lots of other benefits in kind by the state. Total of at least £20,875.

If the kids' father was unemployed and renting a room from a friend in the same area, then just claiming income based JSA and housing benefit, he would get £7173 cash p/a from the state plus again various benefits in kind.

Between the two of them, they would get £28,048 from the state for doing zero productive work at current (2010/11) figures.

Contrast that with a married couple with kids of the same age, where the recently graduated husband earns £45,000p/a working 60+hours per week but with a typical 24 mile commute each way to work in Poole costing say £12/day (i.e. £2700p/a with a 3-5 year old car). Under 2011/12 rules and assuming he was still paying off a student loan, the couple would have net income of only £27,886!

It's not exactly the figures previously quoted but these are solid and in areas with higher housing costs the contrast would be even greater. Either way, it shows just how utterly screwed up the current system is!

PS Having actually produced some figures, some comments on the issue...

Article 12 of the EHCR is all very well but the situation we have in the UK currently where once someone has the kids they 'have a right to', the state will absolve them of any real responsibility to provide for them (up to age 7) and hand out wads of cash is just utterly moronic.

If I had my way, the tax and benefit system would either completely ignore the existence of children OR treat every child equally.

A single mother of 6 children would either receive nothing more from the state than a single male with no kids OR the prime minister's kids would receive exactly the same support as those of a teenage single mother.

I would favour moves towards the former. However, equally I'd accept the later which would in fact be the proper Socialist approach since every child's basic needs are essentially identical; 'to each according to need' after all.

The 'universal credit' certainly won't resolve this issue but by simplifying things and making it more transparent it will hopefully improve the quality of debate about it.

The only positive to my mind is that there is now encouraging talk of fully transferable tax allowances between married couples and civil partners which would at least tip the balance slightly back in favour of two-parent working households.

Phew....I breathed a sigh of relief.
I thought the new MPC board member might be........Gordon Brown.

42. At 9:45pm on 07 Mar 2011, shtove wrote:
"Can you point me to evidence that graduate women are choosing to become single mothers in social housing? A lifetime of single motherhood chained to a sink estate doesn`t appear to be an attractive choice for someone who has worked their way through university for three years and incurred large debts."

I don't have that evidence, but it's pretty clear they're choosing not to have children. When they do, they tend to pay a packet in IVF, and end up looking like a bulldog chewing a wasp. Not happy.
Benefit payouts to single mums are spectacular. I await the day the government publishes proper figures that include housing benefit (or support for mortgage interest) + child benefit + child tax credit + personal tax credit + income support benefit + council tax relief. Well above net average income.
This guy from Goldman Sachs is just another addition to the politburo ... does anyone care?

Not clear what you are saying?,Confirm no evidence that graduate women choose council estates and lots of kids, but say they have IVF and look unsightly.

Don`t see where this is going? You comment on the benefit bill for single mothers and castigate the man from Goldman Sachs?

Lacks coherence,looks like an exercise in free association.

#63 bryhers,

"housing benefit (or support for mortgage interest) + child benefit + child tax credit + personal tax credit + income support benefit + council tax relief. Well above net average income."

All of those benefit and allowence levels are on the record. If it worries you that much work the figure out for yourself!

64. At 7:51pm on 08 Mar 2011, foredeckdave wrote:
#63 bryhers,

"housing benefit (or support for mortgage interest) + child benefit + child tax credit + personal tax credit + income support benefit + council tax relief. Well above net average income."

"All of those benefit and allowence levels are on the record. If it worries you that much work the figure out for yourself! "

I`m sure the benefits are as you claim,nor do I dispute the cost of non-working sngle mothers is high.

I was asking for evidence that graduate single mothers using IVF are queueing to join the army of non graduate single mothers without skills or qualifications living on sink estates.

@48. At 10:48am on 08 Mar 2011, leftie wrote:

"#40 Libert_arian argues that interest rates should be set by the market and not individuals.
#44 Mike3 adds that the BoE's MPC is continuing 'their stagflation policy'.

Both are misunderstandings.
Interest rates are largely set by the money markets ...
What's really happening is that market participants are more averse to borrowing and risk than usual."


Where is the data to show that the official Bank Rate and market rates are not very correlated?
Accepting market participants are more risk averse suggests two concerns (i) confidence signals that BoE sends out & (ii) strength of Governor's statements in support of regulation now (rather than in boom years). Banks will rebalance their loans, so less longterm and risky.